Purpose
The purpose of a peer review is to provide "a disciplined engineering practice for detecting and correcting defects in software artifacts, and preventing their leakage into field operations" according to the Capability Maturity Model.
When performed as part of each Software development process activity, peer reviews identify problems that can be fixed early in the lifecycle. That is to say, a peer review that identifies a requirements problem during the Requirements analysis activity is cheaper and easier to fix than during the Software architecture or Software testing activities.
The National Software Quality Experiment, evaluating the effectiveness of peer reviews, finds, "a favorable return on investment for software inspections; savings exceeds costs by 4 to 1". To state it another way, it is four times more costly, on average, to identify and fix a software problem later.
Read more about this topic: Software Peer Review
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